Correlation Between Nanjing OLO and Xinxiang Chemical
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By analyzing existing cross correlation between Nanjing OLO Home and Xinxiang Chemical Fiber, you can compare the effects of market volatilities on Nanjing OLO and Xinxiang Chemical and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Nanjing OLO with a short position of Xinxiang Chemical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanjing OLO and Xinxiang Chemical.
Diversification Opportunities for Nanjing OLO and Xinxiang Chemical
0.75 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Nanjing and Xinxiang is 0.75. Overlapping area represents the amount of risk that can be diversified away by holding Nanjing OLO Home and Xinxiang Chemical Fiber in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Xinxiang Chemical Fiber and Nanjing OLO is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Nanjing OLO Home are associated (or correlated) with Xinxiang Chemical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Xinxiang Chemical Fiber has no effect on the direction of Nanjing OLO i.e., Nanjing OLO and Xinxiang Chemical go up and down completely randomly.
Pair Corralation between Nanjing OLO and Xinxiang Chemical
Assuming the 90 days trading horizon Nanjing OLO is expected to generate 1.03 times less return on investment than Xinxiang Chemical. But when comparing it to its historical volatility, Nanjing OLO Home is 1.94 times less risky than Xinxiang Chemical. It trades about 0.37 of its potential returns per unit of risk. Xinxiang Chemical Fiber is currently generating about 0.2 of returns per unit of risk over similar time horizon. If you would invest 374.00 in Xinxiang Chemical Fiber on September 16, 2024 and sell it today you would earn a total of 80.00 from holding Xinxiang Chemical Fiber or generate 21.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nanjing OLO Home vs. Xinxiang Chemical Fiber
Performance |
| Timeline |
| Nanjing OLO Home |
| Xinxiang Chemical Fiber |
Nanjing OLO and Xinxiang Chemical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanjing OLO and Xinxiang Chemical
The main advantage of trading using opposite Nanjing OLO and Xinxiang Chemical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanjing OLO position performs unexpectedly, Xinxiang Chemical can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Xinxiang Chemical will offset losses from the drop in Xinxiang Chemical's long position.| Nanjing OLO vs. Lutian Machinery Co | Nanjing OLO vs. China Longyuan Power | Nanjing OLO vs. PetroChina Co Ltd | Nanjing OLO vs. Bank of China |
| Xinxiang Chemical vs. Shandong Homey Aquatic | Xinxiang Chemical vs. Great Sun Foods Co | Xinxiang Chemical vs. Nanjing OLO Home | Xinxiang Chemical vs. Zoy Home Furnishing |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Competition Analyzer module to analyze and compare many basic indicators for a group of related or unrelated entities.
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